Forging Sri Lanka's Enterprise AI Strategy Amidst Global Currents

The global surge in artificial intelligence (AI) presents not merely an opportunity, but an imperative for nations like Sri Lanka. While the narrative often centres on economic leaps in giants like India or China, the critical challenge for smaller, developing economies lies in harnessing AI's transformative power resiliently. This demands a strategy acutely aware of inherent vulnerabilities, infrastructural constraints, and the paramount need for inclusive, ethical deployment. As someone deeply immersed in development economics and policy formulation, having navigated complex international and national governance landscapes, I contend that Sri Lanka’s enterprise AI journey must prioritise strategic resilience above raw speed. The projected economic impact – often cited optimistically, though precise, consistently verified figures for Sri Lanka circa 2035 remain elusive in authoritative public sources – hinges entirely on this foundation.

Tariffs Hobble Sri Lanka: A Critical Policy Analysis of Economic and Social Strain

Sri Lanka’s recent trade policy narrative is overshadowed by escalating tariffs that have severely impeded its economic revival and threatened social stability. Central among these are dramatically high U.S. import duties—approximately 44 percent—on key export commodities, including garments, rubber, and agricultural products. Discipline from global and domestic data, including World Bank, WITS, and CEIC, affirms that such protectionist measures stifle GDP growth, surge poverty rates, and expose Sri Lanka to structural vulnerabilities. This detailed analysis, drawing on credible data, case comparisons, and best practices, critically examines the ongoing tariff phenomenon, its implications, and offers policy pathways to restore economic resilience and equitable growth.

Context and Empirical Overview

Since peaking above 30 percent in the 1990s, Sri Lanka’s applied average tariffs have gradually declined to 4.43 percent in 2015 (CEIC/World Bank). Nonetheless, select duties—especially on imports like petroleum—inflation-adjusted, remain punitive, with maximum duties exceeding 600 percent . Meanwhile, Sri Lanka’s trade-to-GDP ratio stood at just 46.5 percent in 2022, signifying moderate global integration .

Harnessing AI for Inclusive Growth: S.T. Thanigaseelan on Sri Lanka’s Path to a Smarter Economy

Exclusive Interview with S.T. Thanigaseelan (S.T.S), Development Economist & Policy Strategist: “AI Can Add Up to 1.8% to Sri Lanka’s Annual GDP Growth by 2030—But Only If We Move Now”

As the world races towards an AI-driven future, Sri Lanka stands at a pivotal point where strategic adoption could either accelerate economic recovery or widen existing gaps. S.Thanigaseelan (S.T.S), speaks to us about the transformative impact of Artificial Intelligence on Sri Lanka’s economic landscape, highlighting both the opportunities and the pitfalls.

Q: How significant is the economic potential of AI for Sri Lanka’s long-term growth trajectory?

S.T.S: The economic potential of AI for Sri Lanka is profound—if it is guided by strategic policy alignment, targeted investment, and inclusive governance. Projections based on regional comparatives and World Bank modelling suggest that AI could contribute between 1.5% to 1.8% to Sri Lanka’s annual GDP growth rate by 2030, amounting to approximately $8 billion in cumulative economic value over the next five years. AI adoption could also catalyze productivity gains of 15–25% across key sectors such as agriculture, logistics, manufacturing, and public services. However, this growth will not be automatic—it requires deliberate action in building digital infrastructure, investing in human capital, and aligning our legal-regulatory frameworks with emerging technologies.

Sri Lanka's MSMEs Navigating the Enduring Ripple Effects of US Tariff Policies

Introduction: Beyond the Thunderclap – A Persistent Challenge

The initial "tariff thunder" unleashed by the Trump administration between 2018 and 2020, targeting goods primarily from China but creating significant global trade uncertainty and collateral damage, may seem like a historical footnote. However, for Sri Lanka's Micro, Small, and Medium Enterprises (MSMEs), particularly those embedded in global value chains or reliant on the vital US market, the repercussions are far from over. While the most aggressive phase of tariffs has moderated under the Biden administration, the structural shifts in trade policy, persistent geopolitical tensions, and the amplified focus on "friend-shoring" and resilience mean Sri Lankan MSMEs continue to operate in an environment profoundly shaped by those earlier decisions. This analysis critically examines the enduring impact on Sri Lanka's MSME sector, drawing exclusively on verifiable data and established economic principles, and proposes concrete, actionable pathways forward grounded in development economics and real-world best practices.

Tariffs and Turmoil: Sri Lanka's High-Stakes Negotiation with the US Amidst Economic Fragility

The recent dispatch of a Sri Lankan negotiation team to Washington D.C., as reported by ECONOMYNEXT (2025), for a second round of talks concerning US tariffs underscores a critical juncture for the island nation's beleaguered economy. Deputy Minister Harshana Suriyapperuma's statements reveal a negotiation fraught with urgency: Sri Lanka seeks to avoid the reinstatement of punitive tariffs – initially a staggering 44%, now temporarily capped at 10% for three months – on its vital exports, particularly apparel and rubber. While the minister describes "cordial" discussions and expresses optimism, a critical analysis, grounded in publicly available data and historical precedent, reveals a complex tapestry of vulnerability, geopolitical leverage, and deep-seated governance challenges that extend beyond mere tariff rates. The outcome of these talks carries profound implications not only for Sri Lanka's fragile recovery under its International Monetary Fund (IMF) program but also for the integrity of its economic governance structures.

Navigating the New Normal: Disruptions, Protectionism, and Supply Chain Resilience in Sri Lanka

Introduction: The Mirage of Normalcy

The notion of a singular "new normal" offers false comfort. For Sri Lanka, emerging battered from an unprecedented polycrisis – the culmination of pre-existing vulnerabilities, catastrophic policy missteps, a global pandemic, and the fallout of distant wars – the current reality is better understood as an unstable equilibrium. This equilibrium is defined not by a settled state, but by the persistent interplay of severe domestic economic disruptions, a global retreat into protectionism, and fundamentally reconfigured – and fragile – global supply chains. The pre-2020 assumptions about stable trade, accessible financing, and predictable logistics are obsolete.